Chapter 16 Supply Chain

Question 1

Wholesalers are firms that

Answer 1

Firms that buy products from manufacturers and resell them to retailers

Question 2

Fulfillment centers are used

Answer 2

to ship directly to customers

Question 3

When supply chain members who buy and sell to one another are not in agreement about goals it is called

Answer 3

Vertical channel conflict

Question 4

When there is disagreement among members at same level of the channel, this is called

Answer 4

Horizontal Channel conflict

Question 5

3 types of vertical marketing systems (unified system)

A, C, C

Answer 5

Administered - POWER: Coercive, reward, referent, expertise, information, legitimate

Contractual - independent firms at different levels in the channel join through contracts to obtain economies of scale and coordinate. (Franchising)

Corporate - Parent company dictates priorities and objectives of marketing channel

Question 6

Strategic relationships (partnering relationship)

Answer 6

When marketing channel members are committed to maintaining long term relationships and investing in opportunities that are mutually beneficial

Question 7

Flows of information

Answer 7

Flow 1 - Customer to store (Scan code, customer gets
receipt

Flow 2 - Store to Buyer (POS to buyer at corporate)

Flow 3 - Buyer to manufacturer (aggregated store data
sent to purchaser)

Flow 4 - Store to Manufacturer (Sales Transaction data
sent directly to Manufacturer)

Flow 5 - Store to Distribution Center (Coordinate
deliveries/check inventory)

Flow 6 - Manufacturer to Dist Center and Buyer
(Advance shipping notice sent from supplier to
retailer)

Question 8

Electronic Data Interchange (EDI)

Answer 8

Computer to computer exchange of business documents from retailer to a vendor and back

Ensures merch moves from vendors to retailers more quickly

Question 9

Vendor Managed Inventory (VMI)

Answer 9

Manufacturer is responsible for maintaining inventory levels in each of its stores

Question 10

Advantages of using distribution center

Answer 10

1. More accurate sales forecasts
2. Retailers carry less merchandise
3. Easy to avoid running out of stock
4. Cost effective to store merch at dist center

Question 11

Close proximity, few outlets are reasons why Distribution centers _____ be appropriate

Answer 11

Would

Question 12

7 Activities performed by Distribution (fulfillment) centers

m, r, s, g, t, p, s

Answer 12

Management of inbound transportation - planners, dispatchers

Receiving and checking - RFID

Storing, and cross docking - Prepackaged by vendor
for a specific store

Getting merch floor ready

Ticketing and marketing

Preparing to ship merch to store - pick ticket (qty &
item#)

Shipping merch to store

Question 13

2 components of Management of inbound transportation

P, D

Answer 13

planners - responsible for financial planning and analysis of merch and allocation to stores

Dispatcher - Coordinates deliveries to distribution center

Question 14

Benefits of Quick Response (QR) systems (just in time inventory systems

Answer 14

Reduces Lead times

Increased product availability

Lower Inventory Investment

Question 15

Cons of Qr systems

Answer 15

Greater cost to transport

More difficult to coordinate